Multi-year industry trends seldom reverse overnight. When major companies have significant market share and strong revenue growth, usually traders and investors realize all too late when a company's momentum and sales growth begins to slow.

While the S&P 500 and its tracking exchange traded fund, SPY (NYSEARCA:SPY), has rallied over 20% from the lows of last year, and stocks such as Apple (NASDAQ:AAPL) are up over 30% this year, dividend stocks have been the best and most consistent performing sector of stocks in the market over the last year.

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Few dividend stocks have performed better over the last several years than tobacco stocks. The four most popular tobacco stocks in the market are Altria (NYSE:MO), Reynolds (NYSE:RAI), Lorillard (NYSE:LO), and Phillip Morris International (NYSE:PM). Phillip Morris International does no business within the United States.

The tobacco market in the United States has changed significantly since the financial collapse and subsequent recession in 2008.

While Altria, Reynolds, and Lorillard each had significant market share within the U.S. tobacco market with their flagship brands, Reynolds and Lorillard were able to take significant market share from Altria over the last several years with their major respective discount brands, Pall Mall and Maverick. Lorillard was able to show significant and consistent increases in cigarette volumes while management consistently grew the company's market share by a double digit margin over the last several years. Reynolds also saw strong volume numbers and market share gains over the last several years.

This is why I thought the recent earnings reports of Altria, Lorillard, and Reynolds were so interesting. I wrote in my first article on Seeking Alpha nearly a year ago that Lorillard was extremely undervalued and likely to significantly outperform this its two U.S. tobacco peers over the next year.

Still, today the U.S. tobacco market has changed dramatically. While Altria relied on price increases and growth in the companies revenue outside its core cigarette core cigarette business, Altria finally focused on the discount and lower end cigarette market. Altria recently reported that its main discount brand, L&M, saw 24% volume growth year-over-year, and Altria's volume and shipment numbers were also the best the company has reported in several years. Likewise, Lorillard and Reynolds saw surprising declines in shipment and volume numbers, and both companies reported market share losses.

To conclude, I've consistently been negative on Altria because of its high debt load and minimal growth prospects, and the company is using significant discounting to promote lower end cigarette brands. Still, with companies such as Lorillard and Reynolds likely to see their companies' major discount brands face significant near-term pressure and with many leading tobacco stocks at or near their 52 week highs, income and dividend investors may want to change these individuals investment strategies in the ever popular U.S. tobacco sector.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.